Ca Voi

Location

The Ca Voi Xanh gas field is situated in block 118 of the South China Sea, approximately 100 kilometers offshore central Vietnam. This block lies within Vietnam’s 200 nautical mile exclusive economic zone, specifically in the southern Song Hong basin, between the Qiongdongnan and Phu Khanh basins.

Discovery and Appraisal

The Ca Voi Xanh gas field was discovered in 2011 by the 118-Ca Voi-Xanh-2X discovery well. Subsequent appraisal wells, 118-Ca Voi Xanh-3X and 4X, were drilled in 2012 and 2015, respectively. These wells encountered a gas reservoir with a significant CO2 content in the Da Nang Carbonate formation.

Reserves

The Ca Voi Xanh gas field is estimated to contain approximately 150 billion cubic meters (bcm) of gas reserves, making it the largest gas field discovered offshore Vietnam. The field's reserves are classified as gross volume, with remaining recoverable reserves estimated at around 88 billion cubic meters as of 2023.

Development Plan

The development of the Ca Voi Xanh field involves several key components:

• Offshore Platform: An offshore platform will be installed in 242 meters of water to separate gas and water.
• Subsea Systems: Two subsea systems will be part of the field development.
• Pipeline: An 88-kilometer-long pipeline will be laid to transport the produced gas to the shore.
• Gas Treatment Plant: A gas treatment plant (GTP) with a capacity of 737 million cubic feet per day (Mcfd) of gas, expandable up to 900 Mcfd, will be constructed onshore to process the gas.
• Power Plants: The processed gas will be supplied to four power plants, two located in the Dung Quat Economic Zone and two in the Chu Lai Economic Zone, generating a total power capacity of about 3 gigawatts (GW). A potential expansion phase could supply gas to an additional 750 MW power plant or a petrochemical plant.

Project Timeline

• 2009: ExxonMobil Exploration and Production Vietnam Ltd. (EMEPVL) signed a Production Sharing Contract (PSC) with PetroVietnam for blocks 117-119 offshore Da Nang.
• 2011: Ca Voi Xanh gas discovery was made.
• 2012-2015: Field appraisal and studies were conducted, and two appraisal wells were drilled.
• 2016: Reserves Assessment Report was approved, and the Outline Development Plan was approved.
• 2017: The Ca Voi Xanh Project Framework and Gas Sales Heads of Agreements were executed. The project was included in the list of National Strategic Petroleum Projects.
• 2018: Pre-Front End Engineering and Design (FEED) work was completed, and the FEED invitation to tender was issued.
• 2023: Expected start of production, although this has been delayed due to various factors, including geopolitical tensions.

Project Benefits

The Ca Voi Xanh project is expected to have significant benefits for Vietnam:

• Energy Security: Improved energy security through domestic gas development.
• Cost Savings: About 20% lower cost of power compared to imported coal.
• Environmental Impact: Up to 45% lower carbon dioxide emissions compared to coal.
• Economic Growth: Economic growth and job creation in central Vietnam.
• Revenue Generation: The project is expected to generate $20 billion in revenue for the Vietnamese Government.

Partners and Operators

The project is being developed by a joint venture between:

• PetroVietnam Exploration Production Corporation (PVEP): Holds a 36% stake.
• ExxonMobil: Holds a 64% stake and serves as the operator. Other partners include Vietnam Electricity (EVN) and Sembcorp, which are involved in the development of the power plants and gas treatment plant.

Geopolitical Context

The project is situated in an area with geopolitical tensions due to China's claims over the South China Sea via the nine-dash line. However, the drilling location is outside the nine-dash line, although it is within the same basin that China has explored in the past.

Investment and Impact

The project is estimated to require an investment of around $10 billion, making ExxonMobil the largest investor in Vietnam. The project is expected to contribute significantly to Vietnam's economic growth and energy security, and it is considered a cornerstone project for the region.

In summary, the Ca Voi Xanh project is a critical energy development for Vietnam, offering substantial economic, environmental, and energy security benefits, despite the complexities and challenges associated with its geopolitical context.